Browsing by Subject "Contracts"
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Item Contract in electronic commerce(2005) Steves, Douglas Howard; Gouda, Mohamed G., 1947-Commerce is the exchange of goods, services and financial instruments conducted by procedures which define a set of properties sufficient to insure valid and effective transactions. Electronic commerce is commerce conducted using computer network protocols as the communication medium. If these network protocols have the same properties as the procedures used for non-electronic commerce, then electronic commerce will support equally valid and effective transactions. Forum is a system for electronic commerce designed for general forms of commerce rather than specific transaction types. It includes protocols which support the contractual and structural properties of non-electronic commerce, as well as the security properties necessitated by both the value of the exchanged items and the additional risks of the communication medium.Item Contract-driven data structure repair : a novel approach for error recovery(2014-05) Nokhbeh Zaeem, Razieh; Khurshid, SarfrazSoftware systems are now pervasive throughout our world. The reliability of these systems is an urgent necessity. A large degree of research effort on increasing software reliability is dedicated to requirements, architecture, design, implementation and testing---activities that are performed before system deployment. While such approaches have become substantially more advanced, software remains buggy and failures remain expensive. We take a radically different approach to reliability from previous approaches, namely contract-driven data structure repair for runtime error recovery, where erroneous executions of deployed software are corrected on-the-fly using rich behavioral contracts. Our key insight is to transform the software contract---which gives a high level description of the expected behavior---to an efficient implementation which repairs the erroneous data structures in the program state upon an error. To improve efficiency, scalability, and effectiveness of repair, in addition to rich behavioral contracts, we leverage the current erroneous state, dynamic behavior of the program, as well as repair history and abstraction. A core technical problem our approach to repair addresses is construction of structurally complex data that satisfy desired properties. We present a novel structure generation technique based on dynamic programming---a classic optimization approach---to utilize the recursive nature of the structures. We use our technique for constraint-based testing. It provides better scalability than previous work. We applied it to test widely-used web browsers and found some known and unknown bugs. Our use of dynamic programming in structure generation opens a new future direction to tackle the scalability problem of data structure repair. This research advances our ability to develop correct programs. For programs that already have contracts, error recovery using our approach can come at a low cost. The same contracts can be used for systematically testing code before deployment using existing as well as our new techniques. Thus, we enable a novel unification of software verification and error recovery.Item Essays on experimentation in agency models(2019-05-01) Sun, Yiman; Bhaskar, V. (Venkataraman); Thomas, Caroline, (Caroline Désirée); Wiseman, Thomas E.; Hatfield, John W.This dissertation consists of three chapters in microeconomic theory with a focus on dynamic games and learning. It has applications in political economy, contracts, and industrial organization. In the first chapter, I study censorship in a dynamic game between an informed agent and an uninformed evaluator. Two types of public news are informative about the agents ability -- a conclusive good news process and a bad news process. However, the agent can censor bad news, at some cost, and will censor it if and only if this secures her a significant increase in tenure. Thus, the evaluator faces a bandit problem with an endogenous news process. When bad news is conclusive, the agent always censors when the public belief is sufficiently high, but below a threshold, she either stops censoring or only censors with some probability, depending on the information structure. The possibility of censorship hurts the evaluator and the good agent, and it may also hurt the bad agent. However, when bad news is inconclusive, I show that the good agent censors bad news more aggressively than the bad agent does. This improves the quality of information, and may benefit all players -- the evaluator, the bad agent, and the good agent. The second chapter examines the nature of contracts that optimally reward innovations in a risky environment, when the innovator is privately informed about the quality of her innovation and must engage an agent to develop it. I model the innovator as a principal who has private but imperfect information about the quality of her project: the project might be worth exploring or not, but even a project of high quality may fail. I characterize the best equilibrium for the high type principal, which is either a separating equilibrium or a pooling one. Due to the interaction between the signaling incentives of the principal and dynamic moral hazard of the agent, the best equilibrium induces inefficiently early termination of the high quality project. The high type principal is forced to share the surplus – with the agent in the separating equilibrium, or the low type principal in the pooling equilibrium. A mediator, who offers a menu of contracts and keeps the agent uncertain about which contract will be implemented, can increase the payoff of the high type principal to approximate her full information surplus. In the third chapter, I study how competition between platforms affects the process of social learning. Especially, how product differentiation affects that process. Che and Hörner (2018) show that a monopolistic platform may want to over-recommend consumers in the early phase to gather and learn information for the sake of future consumers. I show that when platforms do not differentiate their products, duopoly competition dramatically reduces the early experimentation, and the Full Transparency policy is the unique equilibrium strategy for both platforms. When platforms differentiate their products, I show that the equilibrium strategy is in between the Full Transparency policy and the optimal policy in the monopolistic case, and depends on how differentiated the products areItem Essays on incomplete information in economic development(2007) Steele, Jennifer Lynn; Stincombe, MaxwellThis thesis studies the effects of incomplete information on economic development. Relaxing the assumption that information is complete allows for corruption to occur, even in equilibrium, and for poverty traps to develop. The first paper looks at how the lack of enforcement mechanisms affects contracts, and how a more efficient contracting mechanism can be developed in aid settings. I find that as the level of corruption increases, the contract will encompass more stages. In the second paper, the agent's level of corruption is unknown, and the principal may screen agents by including corruption with positive probability. This would account for the corruption seen in development projects as an equilibrium effect. The third paper looks at the effect of uncertainty about foreign productivity on a firm's foreign direct investment (FDI) decision. Dependent on the form of the information, this may result in either an underinvestment of FDI, or no FDI at all.Item Essays on monetary economics and central banking(2011-08) Ikizler, Devrim; Stinchcombe, Maxwell; Corbae, Dean; Wiseman, Thomas E.; Kuruscu, Burhanettin; Almazan, AndresIn the first chapter, I analyze the US banking industry in order to explain two facts. First, larger banks have lower but less volatile returns on loans compared to smaller banks over the years. Second, larger borrowers have better financial records, i.e. verifiable "hard" information, and they are more likely to match with larger banks, as documented by Berger et al.(2005). I show that these two facts can be explained using a segmented loan markets model with loan contracts between banks and borrowers. Moreover, I show that the difference between the banks returns is not due to diversification advantage of larger banks. Instead, it is because of the fact that larger banks can operate in both large and small loan markets, whereas small banks can only operate in small loans market. Therefore large banks are able to match with larger and less risky borrowers more frequently, which are less likely to default. Moreover, I take the model to infinite horizon allowing bank size to be endogenous to answer multiple policy questions about the future of small business finance and consolidation. I use the data set from the Consolidated Reports of Condition and Income provided by FDIC for 1984-2010 to motivate our research question and to estimate the model. My second chapter revisits the welfare cost of anticipated inflation in an incomplete markets environment where agents can substitute time for money by increasing their shopping frequency. Shopping activity provides an insurance channel to individuals against changes in the return on nominal balances through inflation as documented by Aguiar and Hurst (2007) and McKenzie and Schargrodsky (2011). In my model economy, a higher level of inflation affects people through two channels. First, it distorts the portfolio decision between real and nominal balances, second it redistributes wealth from those who hold more money to those who hold less. People, on average, respond to a higher level of inflation by increasing their price search activity, as they relative return on nominal balances goes down. I find that a 5 percent increase in inflation causes the welfare level go down by 2 percent if people are allowed to substitute time for money, and by 10 percent if we take this channel away from the model. Finally, in the third chapter, I compare the indirect measure of inflation expectations derived by Ireland (1996b) to the direct measures obtained from expectations surveys in multiple countries. Our results show that the inflation bounds calculated for US and UK data are more volatile than survey results, and are too narrow to contain them due to low standard errors in consumption growth series stemming from high persistence. For Chilean and Turkish cases, however, computed bound for inflation expectations seems to fit the survey results better. Out of three different surveys on inflation expectations in Turkey compared with the bounds computed using Turkish data, expectations obtained by the Consumer Tendency Survey fall within these bounds throughout the whole sample period. The success in the Turkish and Chilean cases can be attributed to the fact that volatility in the consumption series, whereas the failure in US and UK cases are most probably stemming from the fact that the current theoretical model is missing a risk-premium component.Item Robust coalition formation in a dynamic, contractless environment(2009-12) Jones, Christopher Lyman; Barber, K. SuzanneThis dissertation focuses on robust coalition formation between selfish agents in a dynamic environment where contracts are unenforceable. Previous research on this topic has covered each different aspect of this problem, but no research successfully addresses these factors in combination. Therefore, a novel approach is required. This dissertation accordingly has three major goals: to develop a theoretical framework that describes how selfish agents should select jobs and partners in a dynamic, contractless environment, to test a strategy based on that framework against existing heuristics in a simulated environment, and to create a learning agent capable of optimally adjusting its coalition formation strategy based on the level of dynamic change found in its environment. Experimental results demonstrate that the Expected Utility (EU) strategy based on the developed theoretical framework performs better than strategies using heuristics to select jobs and partners, and strategies which simulate a centralized “manager”. Future work in this area includes altering the EU strategy from an anytime strategy to a hill-climbing one, as well as further game theoretic explorations of the interactions between different strategies.